Item — HN Reader

Because of their fiduciary responsibility, the officers of a corporation must make decisions that increase shareholder value. Refusing to add profitable data collection to the product due to ethical concerns would be a violation of that duty to the investors.

This will keep happening until it literally becomes illegal to collect personal information.

2 comments

This is a corporate lie that has been promoted relentlessly since the Reagan era. Officers of a corporation are responsible for the operation of the corporation in accordance with the law.

They are responsible to the Board of Directors of the corporation, not the shareholders. The Directors are responsible to the shareholders.

They have a responsibility of care (including a fiduciary responsibility) to operate the corporation in the corporation's best interest, not the shareholders, as directed by the Board.

That best interest can be measured in all sorts of ways as established by the Directors, which may include increasing shareholder value.

The practise of CEOs also being the Chairman of the Board, of executives being major shareholders, of bonuses being driven by share price, are all practises that should be eliminated, given that they are not in alignment with an executive's actual responsibilities and duties.

> Because of their fiduciary responsibility, the officers of a corporation must make decisions that increase shareholder value.

Drilling a hole in your ship may be immediately helpful because you are thirsty, but ultimately it’s not going to end well for you.

I’d say it’s well within the realm of reason to say a hard ‘no’ to investors in this case.